Conventional wisdom is for cube dwellers and butt kissers, not for burning entrepreneurs. Such “wisdom” frequently comes from reading Wall Street tea leaves and hanging on every word of self-appointed pundits. Ignorance IS success when you ignore the data dumps, the talking heads and the naysayers. Clear the air so your fire can burn!

“Double, double toil and trouble; Fire burn, and caldron bubble.” – Macbeth

Every time I hear the word “bubble” I think of that quote from Macbeth. I also think of Tulip Mania and the South Sea Company which purportedly was the source of the concept of an economic bubble. And then I remember Charles Mackay’s classic book Extraordinary Popular Delusions & the Madness of Crowds.


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Conventional wisdom is for cube dwellers and butt kissers, not for burning entrepreneurs. Such “wisdom” frequently comes from reading Wall Street tea leaves and hanging on every word of self-appointed pundits. Ignorance IS success when you ignore the data dumps, the talking heads and the naysayers. Clear the air so your fire can burn!

“Double, double toil and trouble; Fire burn, and caldron bubble.” – Macbeth

Every time I hear the word “bubble” I think of that quote from Macbeth. I also think of Tulip Mania and the South Sea Company which purportedly was the source of the concept of an economic bubble. And then I remember Charles Mackay’s classic book Extraordinary Popular Delusions & the Madness of Crowds.

When I returned from a week off the grid I encountered the word “bubble” over and over again when referring to the tech industry. A variety of people were using it to describe the current situation. This had been going on for at least a quarter or two, but the velocity of it seemed to have picked up with a wave of high-priced VC investments along with large financing endeavors for nascent companies.

While plenty of tech bloggers were tossing around the word “bubble”, I also noticed it among the mainstream media. But more interestingly I saw it in my Twitter feed from some entrepreneurs and VCs who I respect a lot.

In the tech industry, the great Internet bubble inflated between 1999 and 2000 and deflated (or popped) in 2001. I remember it well as 2001 was easily the most challenging year of my business life. I made a lot of mistakes in 1999 and 2000 that I’ve hopefully learned from. I believe I have. I took on a lot of challenging things between 2001 and 2005 that laid the groundwork for the business context that I find myself in today. So, in hindsight, the great Internet bubble of 2001 was very powerful and useful to me, even though it was very painful.

I refuse to make predictions as the only thing I know with certainty is that someday I will be dead. I view predictions as irrelevant in the context of what I am working on and trying to accomplish. Sure, I pay attention to what is going on around me, I have hypotheses about what’s going to happen, and I adjust my behavior accordingly. But I think making predictions with certainty, such as “we are in a bubble” are useless, especially in the absence of recommendations about what to do to either defend against or take advantage of the situation.

In 2008, everyone in business and politics was consumed with the “global economic crisis”. However, entrepreneurs just put their heads down and continued to accelerate the current web revolution which started around 2004 with “Web 2.0” being articulated by Tim O’Reilly. There is once again enormous focus on entrepreneurship as the salvation for many things, with the naysayers starting to say “but it’s a bubble” or some variant.

If you recognize that we are in a strong, positive, upward segment of the current “tech company creation cycle,” that’s more than enough. You should accept that we’ll be back in a downward part of the cycle at some point, but that we don’t know if it’ll be in a week, month, year, or decade.

If you are an entrepreneur, you can build a significant, powerful, sustainable business by taking advantage of market expansion during the up cycle and consolidating your position during the down cycle. Don’t get distracted by speculating about “bubbles” other than the ones in your bathtub. Instead, spend your energy creating amazing products, thrilling your customers, building an awesome organization, and living your life. Always remember that one day you too will be dead.

 @pkedrosky
"Remind me, am I supposed to be skeptical, skeptical about skeptics, or skeptical about meta-skeptics? It's so hard to keep track."
April 9, 2012
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